with kenneth feinberg and other featured interviews from q&a programs on c-span sundays at 8:00. now available for a father's day gift at your favorite book seller. live now to the center for strategic and international studies where coming up in a few moments a discussion on china/russia relations. kevin rudd and former u.s. ambassador to china stapleton roy and others will talk about the increasing tensions between the u.s. and china and russia. speakers will also talk about the warming relations between russia and china. russia signing a $400 billion deal to pipe natural gas across the border to china. we which part this to get under way in a few moments. live coverage here on c-span 3.

again, we're waiting for a discussion on china/russian relations. among the speakers today, former australian prime minister kevin rudd. and later on this afternoon on c-span 3, it's a hearing on u.s.

border security issues, including a look at the pay structure for officers being held by the senate homeland security committee. we'll have that live at 3:30 eastern. and later today, veterans access to health care. that getting under way at 7:30 p.m. eastern also live here on c-span 3. right now we're at the center for strategic and international studies, waiting if r the discussion on china/russian relations to get under way live.

okay. good afternoon, everyone. my name is chris johnson. i'm the chair of china studies here. it's great to see so many friends to join us for what's going to be a fantastic panel. i couldn't be more proud of the panel we managed to pull together. tremendous concern. a lot of thinking about what's going on in the relationship and how it matters for china u.s. relations. and you all have the bio, so i'm just going to go ahead and dispense with that. this is another installment in our china reality check series where we try to look at issues either controversial by their nature or poorly understand here in washington or we feel need more attention across the board. this struck me as i was in shanghai watching the summit as something i needed to do as soon as i got back. we managed to get them in one

roof. so that's great. ambassador roy will follow. prime minister rudd will follow up from that we'll have a few answers ourselves here and then turn it to the audience. >> thank you very much. i think we're supposed to talk about the agreement with china and russia and the implications. >> correct. >> so let me make just three basic points about it, because in my judgment at least it's still in the realm of speculation. perhaps my two colleagues know much more about it because they know more about china than i do. but on the whole so far, most of the issues that arise out of the agreement are subject to some degree of uncertainty. my sense of that on the hole is that it does not really create a situation in which the russians are gaining a great deal. they're gaining something that's essential to them and important

to them. and it can contribute to some degree of influence and success. but they don't retain in my view, at least, as much freedom of action as the chinese. after all, it's a long-term agreement. it's a long-term agreement that involves commitments of both sides. moreover, the russians are making commitment to china so they will have a long-term interest in maintaining the maximum or perhaps even enlarging, and their relationship on that same issue with the european union is already stalemated and it will probably decline. so they have a vast interest in this being successful and sustained. the chinese, of course, do also. it's good to have this russian support. it provides them with a degree of guarantee for the futures.

that's very important. but consider this. in some years to come, there could be issues pertaining to, for example, new opportunities from iran. there could be new opportunities to purchase a great deal of energy from saudi arabia, especially as the structure of world distribution comes out from saudi arabia will be altered. the chinese already have a far ranging long-term agreement that can grow in size. and certainly want to preserve it. and so in a sense, my feeling is while this is a mutually beneficial agreement, the strategic consequences of it are more promising for china than for russia. it doesn't imply in any sense some cleavage between them. it's a normal outcome of a

prolonged negotiating relationship. but the chinese retain options, subsequent in time regarding that agreement that are not open in the same as the russians. and the minor second aspect, i don't know what the price structure for the agreement was. but talking recently to some central asians who obviously have an interest of their own in this agreement, i got the impression their view was the russian were compelled to make serious concessions in the price so even from the sort of price structure point of view, this probably was more to the benefit of the chinese than to the russians, but it does emphasize enforcement of an enduring relationship. the one that can be altered asymmetrically. my second point remains to the realities of that relationship more generally. clearly russia, china and the

united states are the world's most preimminent powers. president obama on the whole correctly demoted russia publicly in recent times to the status of a very major regional power. i don't want to take issue with my president, especially since i'm sympathetic to that point of view, but i do have to acknowledge that when it comes to atomic weapons, russia is a global power. it is a global power that's close to being a peer of ours. whereas china is not. and that, of course, introduces a significant asymmetry in the russian/chinese relationship, although i rather down that either the russians or the chinese are contemplating in nuclear engagement against each other. nonetheless, the fact is russia is a global atomic power. china is not. china lags behind the united states and lags behind russia.

and in terms of targeting, it is very asymmetrical. the chinese believe in minimal deterrence. inflicting the minimal amount of damage to support the consequences they see desirable. but not top damage either on us or in the russians in their targeting. that makes some significant difference. secondly here, however, on the other hand, both china and the united states are global economic powers. russia is not. worst than that, china is a growing global economic power. russia is not. russia is a receding, regional at best, economic power. and that problem is getting more serious for the russians. so here it is also a matter of some asymmetry in the

relationship. and one could even argue that one of the high ly possible ko s consequences of the ukraine adventure is going to be a result, which might well be one of the most damaging territorial political outcomes for russia in the entire imperial history. if you think of russia's imperial history, it has been one o with some setbacks here or there. some are decisive. the war in crimea in the 1850s was a setback. the war with the japanese was a set back in some far eastern significance. the defeat of the 1940s would have been that.

this is a serious territorial defeat for russia. it would mean the loss of more than 40 million people in a large piece of territory. and putin has already accomplished something that hasn't been achieved by anyone so far in the russian/ukrainian relationship. unlike, for example, the polls who for a variety of my judgment on the legitimate reasons strongly suspect the russians. the results of crimea, plus what is going on, is creating a nation of intense hostility towards russia. and if the outcome sustains the western end of ukraine, russia will have suffered. and i think the probabilities are we'll suffer the greatest

setback? so far as the territorial threat is concerned. the chinese are not so concerned about that. the chinese from their point of view unfortunately have rather bad relationships with the border of the countries they border. there are claims and counter claims. and the russians and others are worried about that. the largest piece of territory lost by china historically is to russia. so far the chinese have not raised it openly. although in private conversations with some people, myself included, they have mentioned it explicitly. and the chinese while having regional conflicts, local conflicts with the neighbors, with some exceptions on the whole have acted with restraint on the hole. there has been problems lately with mer time limits and so

forth. but they have not resulted in drastic outcomes. and the last and third point is what about the jewish strategic trajectories of the three countries? here again in russia are going to be straight forward and simple. it was a downward trend. by and large, general trends are negative. take nit terms of population. russian population is declining. take it in terms of russian social talent. large parts of it, not overwhelming, but significant, are immigrating. take it in terms of durability of human life. russia is still relatively on a low level compared to advanced societies. take it in terms of private capital. every successful member of the new middle class is trying to export money somewhere else.

now some of that, up to a point, is happening in china, too. there's no doubt the new class of billionaires is trying to export a great deal of its capital. but by and large, there's still nothing comparable in any way to what is transpiring in russia. there's not a mass immigration movement. there's a sense of vitality, and there's a sense of prospective success. china rising peacefully is still a predominant slogan in the country. slooes on the official level. and again in sharp contrast to russia. now that of course from the chinese point of view and from the global perspective is complicated by the fact that the chinese-russian relationship is not the preeminent relationship. it is the chinese/american relationship that is globally

preeminent relationship. but the decline of russia in the triangular relationship obviously boosts the influence of china. gives china the option of utilizing russia whenever convenient. but presumably out of caution and strategic intelligence, not involving themselves too much. china abstained from resolution. they didn't back russia. they didn't try to veto the resolution. they simply abstained, which shows that the russians do not enjoy the preimminent place in chinese calculations. it is still the united states. and hence a great deal of what transpires in the relationship also depends on us. can we maintain a positionture that enhances the significance

mutually of the american chinese relationship? because that impact on the chinese/russian relationship. and here i have reservations regarding both sides. and i'm not trying to evade the judgment. i think both sides lately have not acted as skillfully and as intelligently as one might wish. and i have from the very beginning some reservations about the wording of the pivot speech. the moment i read it. i said to myself, i really wonder how the chinese will interpret it. why put such heavy emphasis on the significance of the military shift to the east with the afghan war coming to an end? why put so much stress on it. why talk implicitly about some form of entertainment?

about maritime or territorial problems? why not simply say we should have been truthful and accurate and served the same purpose by saying the united states has been part of the east since 1905. the roosevelt negotiating treaties between japan and russia. and it remains one and will remain one. you don't have to say it involves aircraft carriers or military personnel or new deployments or mr. rudd in your country, actually, where it wasn't specified clearly where the american marines to be stationed there are to defend australia from china or from getting -- what is it called? the fact that it's going to be american troops there i thought was the wrong message. not necessary. lately in some speeches, in particularly the west point speech, there was some references the to china in

relationship to other issues which implied the message that the chinese are already in the world. i think we have to be more careful in that respect. they can be critical of the chinese political system. being free. the chinese, however, have been responding to this or maybe contributing to it threw an increase in press about the united states. the fact of the matter is much of the chinese official controlled press is very hostile towards the yis and very explicitly so. some of the articles that i read every week are emphasizing american aggressiveness, american insensitivity, american domineering aspirations and so forth. and that i think feeds a sense of mutual -- mutually increasing antagonism potentially. mutual suspicions and

uncertainties. just coming here i was reading an article entitled the biggest threat to china is the americanization of china from the major chinese publications. it is, of course, connected with systemic challenges within china itself. and the chinese don't like the comparison between themselves and ourselves in terms of who that has the largest number of corrupt public officials. and it's a close call as to which one does. except the problem is that our corrupt officials in keep iing r final culture. rip everybody off as much as you can. the chinese officials happen to be members of the standing committee of the communist party of china. i thought they had different prince p ls regarding the

distribution of wealth. so it's more of a challenge to their internal logic and stability. but the interaction of the two perhaps has somewhat crossfeeding effect. so these are the kinds of problems that i think can surface and limit to specific problems on the ground could become quite serious. one other thing to this watch as far as prospects is concerned is the potential evolution of the very specific japanese relationship. the indian press is full of articles about the new connection between modi and abe and how logical it is if r a spoeshlly stro potentially strong maritime power, technologically advanced such as china to a close relationship with india which is threaten territorily by a nearby strong neighbor. so the chinese have to be very careful in how they handle their

affairs. and for tus challenge is to prove to everyone that america's energy for continued growth and vitality and social success has not been dissipated and especially by social trends, which warn of certain potential risks and intentions and i'll end by mentioning it, the grows disparity between the very rich and few of them and the very many increasing the poor and are the vast majority. >> thanks. >> thank you. >> am boambassador roy. >> thank you. dr. brzezinski has made my task very easy because i basically agree with every point he has made. when we're talking about relations with russia and china, it can't just be summarized in a few minutes. so there are just a few points i would like to make. first, it's an extremely complex

relationship, and it's an a asymmetrical relationship. china's economy is about four times larger than that of russia and the disparity is growing. as a result, until recently russia, including putin was very reluctant to commit russian resources over a long-term period to the growth of china. now some other factors have come into play now. the underlying suspicion about the potential threat to russian interests of an increasingly strong and prosperous china is always an underpinning in russian views of their relationship with china. having said that, though it's very important to understand how strong the impulse is between

the two countries the to improve their relationship. neither of them like a world dominated by a sole superpower. despite the fact that until recently both had more important relationships with the united states than with each other. and i think you can still say that in the case of china. but recent developments in u.s./russian relationships have altered that particular balance. but the underlying fact is they don't like a super power dominated world. and it was reflected in the fact that ten years ago they finally settled their remaining border dispute through a border agreement that involved the transfer of some islands from the river from russia to china and the division of an island.

so who were two big strong countries revolving a territory dispute through the transfer of toir. that's something both governments ought to bear in mind, and particularly china in terms of looking at how territorial disputes are affecting their bilateral relationship. so the trend has been towards improving them, and i think it's fair to say they are the best they have been in post world war ii history. including the period of communist cooperation because it's a different type of relationship now. now having said that, i've melgsed that russia was reluctant to commit the resources to development of china. has changed. it was changing over time, and i think the ukrainian developments have greatly strengthened that desire on the part of russia. in the case of china and looking

at the energy picture, which is what we're supposed to be talking about today, until the mid 90s china's energy strategy was based on self sufficiency. but beginning in 199 3w, chi3, d to move to a different strategy because it was becoming increasingly reliant on the energy. now the diversity of pli. and in large measure because of the ukrainian crisis, the importance to russia of the diversity of demand has become much more important. a large portion of their gas exports have been new york. and now there's a question in russian minds as to how reliable the demand is going to be. and the second factor is the chinese demand is growing rapidly, and european demand is growing very slowly and may

decrease because europe is looking at diversifying their source of energy because they don't like the implications of being too dependent on russia for the source of their natural gas supply. so these are the considerations that came together in this meeting that produced this agreement. now the agreement on its surface looks like a very important one. the supply of 38 million cubic meters of gas annually by china -- by russia, to china, beginning in 2018. that's a big deal by any measure. but we have to be careful. dr. brzezinski correctly pointed out we don't know the details. key factor is price. what with do know is china compromised a long standing position by agreeing to a base

formula for price that is related to oil prices. this is the way the supply of gas is priced. high oil prices means you pay a higher price for natural gas. china has always resisted that type of formula. it's one of the reasons the two countries were not able to reach agreement on this particular deal. now it seems they have agreed to an oil price related formula, but we don't know the details. and it's very likely that russia was in a weaker position than china in working out the final details of the agreement. now the second thing to remember is let's not blow this deal out of proportion. 38 cubic meters of gas per year.

doesn't begin until 2018, and it will take a while to ramp up to that supply. china's current consumption of natural gas is between 70 billion cubic meters a year and 100 billion cubic meters. so this deal represents maybe 25% or less of china's current consumption but by the time the gas comes on stream it will be a much smaller percentage. why? because china set the goal of 2020 of having an annual con sujs of natural gas that is in 200 billion meters of gas per year or 220. so 38 billion viewed in that context is a much smaller percentage of china's overall natural gas consumption. now there's a reason why china is trying to increase the

consumption of natural gas so rapidly. anyone who has traveled to chinese cities knows why. coal-fired pollution is decimating the air quality in china, and therefore they have a major urgent need to diversify away from coal burning and to utilize more clean -- and so that is the trend which is under way, and russia is part of that picture. but dr. brzezinski referred to the deal that is for a shorter period oaf time but goes for $40 billion. 40 billion cubic meters of gas per year at its maximum level, and there's a possibility that will rise to 70 billion cubic meters per year. so once again, australia is becoming an important potential

supplier of lng to china, and somewhere around 2020 it's possible that u.s. frack gas will become available for export to asia, and that will also affect the considerations. so if you look hat this particular deal in the context of this broader picture, you realize that it's an important arrangement, but it's by no means one that ties the two countries together in a highly dependent relationship over a long period of time in the sense that one country could exert influence over the other by dealing with the supply of gas, as russia has done with ukraine. chi gnat is not prepared to subject itself to that

leveraging. so within that context, i think we should not assume that the rivalry factors in the russian relationship have been eliminated. they're very important in central asia, for example, where the chinese supply of consumer goods has essentially driven russian goods out of the market. but russia still has those historic relationships with the central asians. now here's an interesting point, and i'll close on this point. we just had this conference that putin attended called the conference on interaction and confidence building measures in asia or cica if you will. at that conference president xi jinping gave a very important speech in which he addressed a major security proposal. he's talking about a collective

security arrangement for asia. and there was some language in the speech that seemed to be targeted against the united states. but if you look at other language, you realize this particular organization has 26 members plus some observers. of those 19 are not in east asia. they're relative to central asia, not to east asia. and president xi emphasized no should dominate the security of a region and all countries have a right to their security independence from other countries. was that really targeted at the united states, or was that targeted at russian security ambitions in asian? i mean for the latter interpretation because of the locus of where he made the speech. that doesn't mean there were not elements aimed at the united states, but it suggests the

complexity of the relationship. we should be very careful to do our homework before we jump to premature conclusions. great. thank you. prime minister rudd, you certainly travel to beijing a lot and have embarked on this very ambitious project at harvard to speak on these issues. i wonder if you will frame how this is all seen through beijing's eyes and how you think that sets the strategic framework going forward. >> good. thanks very much. i take very much stapleton roy comments. and there's two ways to transfer them to a snappy phrase which then causes us to reach false strategic conclusions. that's the first caveat that we should all apply to a serious study of strategic affairs.

the second point which arises in my mind is when we look at the content of the recent summit between vladimir putin and president xi jinping in shanghai, what does it actually mean as opposed to what everyone theorizes it means. and in 2 soviet relationships, does it mean a lot? and within that frame, are we looking at a dramatic event which fundamentally turns the dial in the arrangements which ken henry kissinger and richard nixon reached in the '70s, which was a strategic conversation between washington and beijing based oen a common attitude

towards the soviet union. that was all genuine global strategic significance and the subsequent unfolding of what became modernized china as well. have we reached a new point at which that fundamental access has now changed? i think the -- personally, that the shanghai meeting represents the culmination of forces that are being worked for quite some time in the china/russia relationship and the china/u.s. relationship that began to alter the premise of the 1972 strategic concord. the second point i would seek to go to is how then our analysis to one side has reality viewed to beijing.

and finally, based on recent travels to moscow on how some of these realities are viewed from moscow as well. on the china view of reality, i think it's always important to go back to the fundamental principles of what are china's abiding national interests and where does the russia dimension fit into that equation? the first point, if you were sitting around the table whether it's arkansas ticklated or not, it's certainly assumed that the number one interest of the committee is to preserve the communist party in power. it is not something we should simply smile about and pass on from because when you look at the current dynamics of the russian politics and the russian leadership, there is no critique

coming from moscow, nor has there been for a long, long time in terms of the viability, the credibility of a one-party state. so in terms of regime fundamentals, you do not have a ruling critique of the fundamental nature of the power coming from moscow. and that is of some genuine comfort to china given the volume of critique it contains from the rest of the world in sustaining the current political model. number two, from the chinese national interest point of view o is this, the maintenance of political sovereignty and territorial integrity. well, there's nothing remarkable about that. that's the same discussions we have around any cabinet table in any capitol in the world. but applied to the russian

question, this is of profound significance. number one, the facts that in that period post '89 starting with that meeting between gorbachev and dunn in the middle of '99, which began the settlement process of the receive yet chinese and then russian-chinese border, that provided the fundamental long term security from a chinese perspective about the vast expanse of 4,300 kilometers of the land border across the north. any student of chinese history will tell you the highest levels have always existed in terms of what comes rolling across your ears for the north. and if you include japan in the north, we're frankly into the 20th century as well.

the strategic significance of effectively settling the russian-chinese boardser which occurreded in a process beginning in the meeting in '89 and concluding with the river negotiations and agreements most recently, these are profound strategic significance. because the core point is this. china no longer regards russia as a threat. and this is a deep, deep question which has been resolved from a long period in history. therefore when we look at china eastertorial integrity and territorial claims, the focus is now no longer on this vast border but on india and on the mer time disputes and borders on the other with japan and southeast asia. the third national interest of china and where russia again

fits into this is, of course, the paramount importance. the number one, number two, and number three of the leadership is how do you transform the model which has served from 1978 to 2012 into a new model that is essentially based on domestic consumption replacing investment as the drivers of economic growth. secondly as opposed to traditional labor intensetive and energy intensive manufacturing and number three with a greater role for private firms to enterprises into the future. this is where the bulk of this government, this leadership in china's energies are currently focused.

the underpinnings in the old growth and new growth model and where it's been so plarimportan lies in the security. and with the security of raw material supply and food security, china see l a potential long-term, huge strategic partner. yet to be fully articulated. yet to be fully expressed. but of direct significance to the continuation of this transforming process of china's path to economic identity. number four is this, that within the framework of these other three sets of interest, china, however, in the period since we could point to october or november or last year or maybe september or october of last year in a conference on

diplomatic work, arkansas ticklated a new approach to at least east asia and the neighboring states. and this is of relevance to russia as well. the best word to describe it is proactive foreign policy. some would describe it as assertive foreign policy. and open to multiple definitions, and there is no official one. basically more active than it used to this be. ft that's how we can safely define it in the modern oxford or web ster dictionary, whichever side of the pond you have to be on. you don't have to be international theorists to conclude that chinese diplomacy has become more active across the east asian hemisphere in the last six months plus. we can point the the

manifestation of various domains of security policy as well. and more broadly, multilaterally as well as individual multilateral agreements come up for renegotiation or reconsideration, china is actively exerting its views about the redraft should unfold. while this is relevant to the russian relationship is china finds a large scale strategic partner, providing it with diplomatic leverage, but not all of them. and direct conflicts in diplomatic interests over ukraine. but on balance, this is a useful strategic condition. to conclude, a few thoughts from a russian perspective. i spent a week in moscow recently with one single

question, what is russia's long-term view of china? and i spoke with a whole range of people across government circles, and there's a high degree of coalescence between russian interests and those which i've just described as being chinese. but there are a significant degree of noncoalescences as well. and it's important to be clear about them. when you roll in the door and ask a senior russian diplomat, so how is it going with china, chris? the response is along the lines of best it's been in 450 years. and so to which i would say it's been rough as of late, has it? but there's something in it, because if you look hat this grand narrative between russia and china, going back to the acquisitions for a lack of a better term, this is by and large a very sharp and c

cantankerous relationship. the answers flow reasonably quickly. number one, china does not challenge the legitimacy of our own political arrangements. number two, the economic potential of this relationship provits us with-- provides us w huge ability to sustain ourselves from any pressures elsewhere and frankly become a much bigger driver of growth in the future than we've ever seen in the past. remember, bilateral economic trade is only 70 or 80 billion u.s. with australia, i think it's about 150 billion or more. but that 70 billion has grown from nowhere in the space of about five to seven years. so the the trajectory that they see is huge. and of course, the juxtaposition

against the western sanctions over ukraine is clear and transparent to us all. so our russian friends show that very deeply. and finally of more interest to them perhaps until china recently has been the fact that they can work together in pursuit of what's been described already in the global base order, which basically means anything that lessens u.s. influence is acting as a sole power, a unilateral power or one driving consensus against its own interest. and then to include on the anxieties in moscow, and this is i think is equally relevant. the anxieties have already been pointed to in part. but when you scratch the the surface, the deep anxiety over the central asia. and this is profound and it's deep. the five are very much seen as

russian influence given where they have existed most recently, historically, in terms of the composition of the soviet union. within that frame, kazakhstan of of particular significance, simply geographical size and the resources. the russian concern is that over time just given the sheer weight of economic power that china has in its possession, it will overwhelm central asia simply by the volume of its economic presence and an ongoing relationship with moscow which will then be overwhelmed. final point on the question of the crimeaen an exation resolution is also relevant. russia is an enormously proud proud of its history and still believing deeply that it has a long national future ahead of it. there is, i think, a deep

concern in russia about if and when china starts indicating to russia what it should do in terms of global diplomacy through the united nations system. this, i believe, is a very deeply entrenched concern in terms of how the power realities have played out between the two of them on the global stage through the mechanisms of the u.n. when you ask our chinese friends how do you characterize the russian relationship, the form of language is not, it's the best it's been in 450 years. their phrase and chinese leaders in my experience choose these phrases carefully is one in which describes the china/russian relationship as a collaborative strategic partnership.

so what does that mean? this is where i think we should conclude. within the framework of that collaborative political diplomatic and strategic behavior, what we are likely to see, quite apart from a framework but exclusively on a bilateral framework, more and more intense political diplomatic and strategic policy coordination between the two of them. if the shanghai meeting represented anything, for me it was that, but within the framework of events unfolding over a long period of time which have set the redial on the 1972 deep changes to the strategic architecture engineered by american political leadership at the time. >> thank you. doctor, i know you have to leave in a few minutes so i'd like to give you the opportunity to maybe respond to our other two panelists' comments and pick up in particular on a thread you raised which i think is so very important in your remarks which is this issue of the trajectory

of russian imperial dominance of the region, where we think that's going, and in particular, how you see that playing in the central asian context, especially with the ur asian effort with very few numbers announced. >> first of all, i think we're basically in agreement. there may be some differences of emphasis but we are in agreement that this is an extremely complex relationship but also in terms of the russian chinese aspect there is an asymmetry in which they can do under the current circumstances. the one point which perhaps i would emphasize different aspects or define it somewhat differently is this issue of the territorial relationship between china and russia. it's absolutely correct that the chinese take a position that legally everything is resolved but i have also been truck by

the fact that in private conversations some chinese are beginning to bring it up. where that will take them, we don't know. but in one respect we already do know, namely, that the competition for influence in central asia to which mr. rudd just referred to is in part competition, ir regards to territories that in the broad sense the chinese in the past view as somehow subordinate to their sphere of influence. for the russians it's a central issue as to whether they can be incorporated into this concept of the ur asian union. i spoke to one chinese official who in a friendly conversation in which we sort of talked about the last several decades and in which we talked about the future and i realized that no conversation of that type is ever truly friendly, at least the tone was that. he did say to me suddenly, and i

want you to know that we are really moving westward. when i heard that, i was kind of baffled for a few seconds. thoughts flashed through my mind, is he talking about some special relationship between china and germany maybe or western europe? then of course it quickly dawned on me, no, he was talking about central asia. he started to amplify, amplifying all the different undertakings that the chinese are pursuing, the effect of which is of course a more cooperative relationship with central asia but also a relationship in which their influence rises and someone else's inevitably declines. then of course there is the attitude of the central asians themselves. part of their game right now -- and that's been done diplomatically in kazakhstan,

far less diplomatically in uzbekistan is to limit the significance of the ur asian union in part not only by open opposition or reluctance but in part simply by enhancing the relationship with the chinese. this is the ur asian economic union, very important qualification. russians whe and has invited the n.a.t.o. office which has an echo to the previous comment. to some extent it's beginning, perhaps to being -- they are no longer inclined to ignore the fact that at one point in a

significant fashion russia benefitted by expanding their territory to china's expense. this had strategic consequences for china that were negative and perhaps were entering a period in a determined fashion, some of these asymmetries can now be reduced or reversed. what happens in russia will then affect that. if russia at some point becomes a committed long-term enemy of the united states, it has to be associated with china and de facto as a subordinate. if russia chooses to democrat ties after putin it gone, it might be able to retain its position in the far east if it really becomes part of the west and of europe especially. i once wrote something to the effect that in those

circumstances it will surely and safely be russia but especially so a lot of the people living in it are germans and french and polls and portuguese in a more united europe. that is the big geopolitical uncertainty and a lot of american/chinese relationship unfolds. if we can keep it stable and cooperative, that's good. i refer to the chinese as -- one recent example, the chinese military reported on the visit by our defense secretary, chuck hagel, to their aircraft carrier. they long asked us to be invited to ours, so we invited them to ours, the reagan one. the chinese are making a big deal of the fact that our

aircraft carrier is so much more modern, effective, so much more capable of being threatening than theirs that this is an invitation deliberately designed to humiliate. i think we have to strife to seriously divert it and they have to strive to divert it and they had a long editorial emphasizing precisely that point, that america and china have to resume striving, that things they're hinting have slipped and it isn't easy to point a finger at one side and say they're the fault. i happen to agree with that. we have done it and they have done it, too, and i think we better take a second look. >> i wanted to follow up on a comment of yours. >> excuse me, thanks very much.

>> you mentioned this issue of the chinese making a compromise in terms of how it's structured. one issue that didn't seem to come up publicly in the summit is the whole issue of defense cooperation. my sense is that that has started to shift as well in terms of the dynamic. i think the russians have been long represesistant to sell to chinese. there was a period where they were not engaging in cooperation in that area. when the president first took office and went to moscow, the tv seems to think there was a deal and the russians were quick to say i don't think so. do you know whether there was a defense cooperative component or where tu think the trajectory is going because i think it's the other key piece of the relationship. >> i think there's a growing

defense cooperative peace between russia and china but i think it's shifting from a military supply relationship in which russia has provided more advanced military equipment, particularly in terms of fighting aircraft and submarines than the chinese were producing but not providing their best technology. now it's shifting toward more military cooperation in a sense of combined operations. there was a joint naval exercise. there's a technical term. during the meeting in shanghai, their naval units have been doing some joint exercises together involving other components of the military. i suspect we may see that type of cooperation expanding. but the other side of it is,

chinese military technology has been catching up very rapidly and now china is beginning to be able to produce cutting edge military technology in certain areas. i think as a strategic goal, china does not want to be dependent on russia for its most advanced weapons systems. to the extent that russia is prepared to sell them, china may sill be interested in buying, but my impression is that the military sales from russia to china have decreased quite sharply as china has caught up in its own capabilities. >> kevin, you talked a little in your remarks about the domestic politics in moscow, kind of how they see things and also a little on the chinese. i wonder if you might expand on how you think the domestic politics in china factor into this relationship. >> every diplomatic observer has

to conclude that any country's international policy postured given at a time in history is shaped by the realities, and the only question is by how much and whether that's positive or negative. i think what we have here and i've spent time with the prime minister and some time in conversations with him is a unique post dunn product and that's very self-assured, very self-confident, i think a leader who describes himself as a strategist and a grand strategist in terms of where china goes for the future, very comfortable with the exercise of power. as i've said before perhaps here or elsewhere, and as a

consequence wields an extraordinary political influence of the type we have not seen since dunn's expedition in 1992. we may disagree or agree on the detail about that but i haven't seen anything like this in 20 years or so. point number so is the domestic preoccupations are huge. we've spoken already about the challenges on the question of china's economic transformation process which are formidable and complex in their own right if no other challenge existed of any other character. number two is this, because the prime minister, based on what i described earlier national priority number one which is to keep the chooinds communist party in power has launched an anti-corruption campaign of the type i have not seen in my years of analyzing modern chinese politics and certainly

unprecedented at least since the late 1970s. so this is taking an enormous amount of domestic political energy and you've seen it applied to the military which is significant in itself, the recent public humiliation of the former chief of general staff, as well as what is happening within the high levels of the chinese communist party proper. this is massive. now, one of the open speculations at present is the extent to which this is create region domestic forces within china itself. take those two sets of realities out to the broad equation is how are those dynamics affects international relations and driving the question of the russian relations in particular. i think because of the his authority within the system, what i observe and i stand to be corrected by others who follow this more closely is a high

degree of chemistry between he and vladimir putin. if you follow chinese domestic media sites or twitter sites, he's popular within china as a strong leader who is able to take it up to the united states and take it up to the west. as a consequence, because he sees himself as his nation's strategic architect for the period ahead, i believe that these large moves in terms of a closening of the relationship with russia, a firmer posture in the foreign policy terms towards the rest of east asia and the neighboring states in particular and those with whom there are border disputes in particular are all part of a strategic evaluation, reevaluation of where china sees its interest long term. the third leg of that of course is what he announced last year

in terms of a new type of strategic relationship with the united states. as the doctor said before he left, that's the one which has kind of been swinging in the breeze a bit for the last 12 months. if at least some suturing which needs to occur it's taking that headline which both president obama and the prime minister broadly agreed with and giving it content. that's quite a rocky road. does that movement towards russia, no progress on the new type of relationship with america and a new proactive diplomacy to use the new chinese definition with the neighboring states, there's a projection in some respects of the dominant personality and his analysis about where he wants to take china to the future. >> steve, did you want to add to that? >> no. >> we'll turn it over to the audience and welcome your

questions. if you would identify yourself and let us know which organization you're with and please try to confine yourself to a fairly brief question. the gentleman in the back there. please wait for the microphone. >> barry wood. mr. rudd, could you say something about the bricks and how both china and russia relate to it, and specifically, the plan to set up a development bank. i wonder if this is a means of cooperating in central asia. >> the bricks have been around as a strategic concept. i think we can thank the magazine for the definition and whoever wrote the article, i think it was from goldman's at the time which witled together the economies of brazil, russia, india, china and who else? >> south africa. >> whether it becomes bricksy to

include indonesia. two is being a strategic concept which has in many respects formed a ballast around china in its internal negotiations with other states who are members of the g-20. the brakes makes it not just head of government level but head of foreign ministers level and finance level. often when you go to major summits around the world there's an agreement an brick's position. on the specific proposal for an infrastructure bank, then there's -- which has not been agreed, at least in principle, this left hand largely driven by chinese financial capital.

i think that's accepted. there's an active debate about where it's located, therefore whether it becomes in china or some recent debates about whether it's actually in jakarta as a potential, shall i say bridge to our friends in indonesia and recognizing that the republic of indonesia is going to become one of the ten largest economies in the world. a quarter of a billion people live there. growth in recent decade of six to seven percent and massive infrastructure needs. in terms of the political symbolism and its place within the asian atmosphere, i think it aids china's strategic and foreign policy interest but with one caveat. the amount of capital this is going to have at its disposal is relatively limited against regional and gloebal needs. prooi private financial markets will

be the source of structure needs. i think in terms of adding financial capital to the region to meet its infrastructure needs is all fine and dandy but you should see it in a context of frankly the sheer volume of need and the volume of private capital which is interesting in these areas of investment as well. >> in the middle here? >> thank you. i would ask, some chinese experts say just by china being lur ruled by the communist party no longer but why is the relationship better with the russian relations and secondly do you think the relationship is going to involve much further, i don't think like the cold war days but do you think it's going

to be involved much further? thank you. >> i'll begin with an answer but i think the prime minister rudd can weigh in on this very effectively also. i think that recent developments in east asia and in europe have tended to push china and russia closer together. i think that's one of the factors that produced the gas deal that we have been discussing here. they've been negotiating for ten years over price and all of a sudden the pieces fall together. i think it's not accidental that the united states' relationship with china has developed much more positively than russian chinese relations. if you look at our bilateral

trade it runs over $500 billion a year. russian's is $100 billion a year. if you look at the trade statistics, russia's number one trading partner both for exports and imports is europe, the e.u. china is second terms of both exports and imports now, but the differential between the e.u. trade and the china trade is very sharp. i'm talking about four or five times larger in the case of the e.u. so china has been able to develop certain areas of cooperation with russia that have been beneficial to china. i earlier referred to military technology, for example, as one of those. in terms of modernizing its

economy, in terms of the expertise needed, namely, what you are taught in universities about development and about business management, china has largely turned to the western countries and particular in the united states. as i mentioned, until recently russia has been resistant to overcommitting itself to the development of china. i think it's too early to tell whether or not the recent cooperative trends will be extended into the future for a long period of time. for example, japan also shares a strong interest in getting expanded access to the natural resources in siberia and the eastern territories of russia. and i wouldn't be surprised if you were to see a russian japanese deal involving oil, gas, timber, other types of

minerals that they are interested in developing. so i think this is something we have to watch. there's no question that the russian relationship at the moment is at a high point, but i don't think that china has lost sight of the fact that the united states still in very important respects is much more important to its ability to achieve the great rejuvenation as the chinese people which is the china dream. >> to add briefly on the try angular aspect which you made as part of the second part of your question, from china's perspective, my judgment is that china's sees strategic lef rage to be obtained by moscow. that informs part of recent decisions. it doesn't explain all of them. i think that's a reality.

secondly, however, china in doing so has been simultaneously active in reaffirming the principles which govern its relationship with russia. these are not new but continuing since the days of yeltsen really. there will be no alliance. the second one is that there will be no conflict, and the third is not directed to the third party. the chinese i've noticed have recently emphasized that in order to discourage the view that this is actually heading in the direction of some form of informal or even formal military alliance with russia. it's important to bear that in mind. strategic lef rage is one thing. strategic alliance is another. we need to be clear in our

thinking of that as well. there's the third point about the strategic triangle which i do think is important long term. that's china has internally concluded that it is being contained by the united states. that's its internal conclusion. whether we support that conclusion, agree with it analytically or not is to some extent beside the point. that's very much their internal conclusion. in part, it explains china's behavior in relation to the triangular relationship. therefore, what i described earlier as being mindful of not oversimplifying a complex, a shift in the dynamics of the triangle which have been unfolding for quite some time and i think the extent of that shift has been in many respects symbolized by the recent shanghai meeting. it doesn't go from strategic

neutrality to the alliance but the nature of the triangle is significantly changed from that which dr. kissinger and others engineered with the chinese leadership in the first half of the 1970s. >> i always try to resist the desire to play player/coach but to throw in a brief comment, especially on the triangular relationship, it's important to look at two things in the way the chinese are describing the relationship that i think are important. the first is they're calling for a new style of great power relations but only with the united states. the russians aren't included. i think that says something about how they see that triangle developing these days. i think the second very important point to take into consideration here with regard to the russia relationship is how does china intend to use the relationship with the russians to balance the relationship with the united states. in particular, to the degree that they see having an active russia card or option, i think

actually under the umbrella of managing u.s. relations is a critical factor and i think some chinese would argue if we the united states in their terms are foolish enough to allow them to maintain that active card, then that's our fault in the strategic triangular relationship. next question, up front here? >> thank you. i thank prime minister rudd and the ambassador. you mentioned, prime minister rudd, the shanghai and the balance. i remember you talk about the power in asia and i'm concerned

about the south china sea. i'm going to ask you as the leader of australia where do you see the role of australia and the u.s. allies in that region, especially with the current situation in the southeast china sea, the south china sea with china actively, assertively, aggressively invaded. it did invade vietnam and all the countries. there had been people killed recently, ships sank, two ships and we have chinese vessels in that area, including air forces and all the military efforts. >> thank you. i got the thrust there. firstly, i'm not the prime minister of australia.

>> but you play it on tv. >> that's a different bloke. >> you all look the same. >> i can never tell them apart myself. you and the guys from mississippi all talk the same. shall we continue this? anyway, let's go to the core elements of your question which is one of what is unfolding in the maritime space and secondly what policy should be considered in response to it. i think it is fair to say that i have not seen such activity in these maritime zones in the south china sea. i think at least since the mid '70s.

you can have an argument about that in terms of what happened in the south china sea before then. it is at a more frack shus state than i have seen certainly in my diplomatic career which began in the early '80s. so that causes me concern. it caused me concern for one particular reason. we have never taken a position on who's right and wrong on territorial dispute for the simple reason the complexity is just mind boggling. that's why you have other dispute resolution mechanisms available. however, what worries me about the danger of conflict through miscalculation and poor incident management. there is a piece of mathematics here which people who fly aircraft and drive ships usually tell you about which is the more metal you've got in a given

space at any given time, the more likely they'll hit each other, and therefore, if that is the case, we now have literally hundreds of assets rolling around the place in particular zones at particular times with varying degrees of skill on the part of those who are driving these assets. then incident management -- incident probability is high. incident management enters into the equation. which i read reports of aircraft in the east china sea recently passing within 35 millimeters of each other at considerable speed, i become deeply anxious about, a, the probability of incidents, but most particularly about the absence of protocols for the handling of incidents once they occurred. for me, what i become quite electric about in this current

environment and worries me deeply is notwithstanding all the pre-existing strategic tensions which exist, the historical animosities which exist, the political disagreements which currently pertain, it is simply the rising mathematical probability of an incident, the absence of protocols to manage the incident and therefore the risk of elevation of the incident into a high level of conflict. you don't have to be a rhodes scholar in international relations to work this out. that's what really worries me. you asked about my country. i'm a guy who has advocated for the last five or six years that in order to construct effective security building measures in

oi asia we need to develop an asia pacific community. i see it as something beginning with the most basic forms of political security and economic cooperation and building, step by step across the river. we don't have any institution like that at the moment. while these institutions do not solve, necessarily, fundamental pre-existing conflicts, they can take the edge off them. that's the experience of the european union. so it's my proposal 2010 through some australian diplomacy with others, we've managed to get america and russia into the east asian summit around the table. they have an open agenda to discuss political strategic, whatever questions you want. my strong argument is we should

now begin using it. item number one should be a region wide protocol for managing incidents in the air and in the sea across the armed forces and the naval forces. those who are perspective shall i say participants in an incident, you're now talking about seven or eight sets of armed forces across air force, civilian aircraft customs aircraft, customs and patrol boats, naval aircraft, fishing vessels. this rubik's cube of complexity is such that you need some governing protocols. so that's where i believe we should go. >> right here. >> i just had a followup on that comment that you just made. isn't the structure of alliances that's developing or does exist

now in east asia actually complicate the situation which would arise if there were a very serious incident of the type that you were just imagining. i was struck by that comment of a chinese analyst who said, well, one thing chinese don't really understand is how to deal with these alliances. i mean, we have japan america alliance, philippines america alliance. we can deal with a country one at a time but we're note so familiar here. and isn't the worry about the way the appliances play into a serious incident of sort of pulling everybody in what's led to the recent books for example by hugh white and malcolm frasier questioning what might happen here. >> a lot disagree with the work by hugh white for a range of reasons which i won't go into. let me go to the question of alliances. what do all these alliances with the united states and east asia have in common some most predate the emergence of the people's

republic of china and certainly any strategic capacity of the people's republic of china to constitute a perceived threat to anybody. let's take the australian alliance which was formed in 1952. why did we end up with an alliance in '51 or '52? we ended up with that, that was the price to pay for the u.s. and japan peace treaty and the u.s. japan security treaty. politicians in australia at the time having just been through the second world war were not about to be passive on the question of any future emergence of a mill tar is tick japan. so the entire strategic frame within which that was put together had nothing to do with china, let me tell you. it was also to do with a threat from china where we just lost a bunch of people in the second world war and -- japan and the second world war and where we're

going to go into the future. if you look at the alliance structures across most of east asia, the korean one is different because of the korean war. thailand and the philippines come out of different circumstances. the idea that these things have their origin or their current manifestation in an anti-chinese form of strategic behavior, i think that begs a whole lot of further analysis. there's a further question, too, if you are a bunch of australians occupying a continent as large as the united states and there are 23 million of you, then -- which is half the population of california with an economy the size of the netherlands, or about the size of the republic of korea, it kind of makes sense to be allied with someone who you've had a few things to do with over the

last 100 years. if you are responsible for 32,000 kilometers of coast line, on the basis of that as an independent nation, yeah, an alliance is not a bad idea. >> do you want to toss in a word or two? >> i'll very briefly comment on the fact, perhaps our alliance structures confuses chinese who would prefer to deal bilaterally with these issues. i think it's important, however, that they read and understand the nature of our alliances. they're fundamentally defensive but in the case of both the japan alliance and the philippine alliance, in the case of the philippine alliance, an attack an a ship or aircraft anywhere in the pacific is covered by the alliance. in the case of the japan one, it applies to areas that are ministered by japan, not simply the japanese territory as recognized by the united states.

the chinese don't like us to point this out, but the reason we pointed it out is to avoid inadd vert ans, misunderstanding of the nature of alliances. the other side of the coin is equally strong. the united states does not want to get into conflict with china or any other country over essentially minor territorial issues involving uninhas been eted rocks in the south china or east china sea. we haven't lost our good sense in wanting to be a good ally of these countries. the purpose of these alis was to protect them against aggression. basically, the american approach -- i would add a third element. we did not sign a declaration on the contract of the parties in the china sea. that was signed by china and the south eastern countries in 2002.

if you look at the statement of then secretary of state defense panetta, you had find the american position is based exactly on the principles set out in the declaration of parties. peaceful resolution of disputes, no threat or use of force, no provocative actions, efforts to construct tifl approach differences. if the principles of that declaration had been carried out by all the signatories we haven't have the current level of tensions in the south china sea. we deal with our allies in terms of upholding those peninsulrinc but we will be allies if subjected to unprovoked aggression. >> i want to thank you both for your insightful comments. i appreciate the audience's participation.

join us in about an hour for a hearing on u.s. border security issues, including a look at pay structure for officers. it's held by the senate homeland security committee live at 3:30 p.m. eastern here on c-span 3. later on it's a rare evening congressional hearing, the house veterans affairs committee will discuss veterans' act tcess to healthcare and waiting lists at 7:30 p.m. eastern live also here on c-span 3. congress is back this week, the house today considering a series

sus suspension bills that authorizes spending for 2015 transportation and housing programs. votes on amendments to that legislation could occur later this evening. you can watch the house live on our companion network c-span. the senate back today for general speeches at 5:30 on three district judge nominations for virginia, massachusetts and nevada live on c-span 2. russia's only lawmaker to vote against an exing crimea spoke at the heritage foundation in washington d.c. earlier this month. the p they discussed u.s. russia relations. since the vote against an exing crimea he's being condemned as a

national traitor. this runs just over an hour. >> good afternoon. welcome to the heritage foundation. we of course welcome those who join us on all of these occasions on our heritage.org website as well as those watching on c-span this morning. for those in-house, please check that cell phones have been turned off as a courtesy to our presenters. of course we will welcome questions at any time. simply e-mailing us at

speaker @heritage.org. we have dr. ariel cohen, senior research fellow and our institute for international studies. he works on such issues as economic development and political reform in the former soviet republics, the global war on terrorism and the continuing conflict in the middle east. he has served as executive branch in the private sector on policy toward russia, central and eastern europe, the caulk kuks in central asia as well as ur asia in balance focusing on the eastern european region. please join me in welcoming dr. ariel cohen. >> thank you very much, ladies and gentlemen.

it is my particular pleasure to welcome you to the heritage foundation. it's a pleasure because i always admire people who have courage to speak truth to power. it is not easy in any society. it is particularly not easy in today's russia. ilia could have a wonderful life in russia. he was the youngest president of the ukus oil company. at the age of 24 he worked for multi-national oil services companies. he is extremely gifted as a youngster, as a 14-year-old he was teaching computers in the soviet nuclear physics institute to the old guys who didn't know

at the time about pcs. so either a career of a conformist politician or a businessman would have saved ilia a lot of trouble. instead, he decided to take principle stances. he was the only one in the duma who voted against the so-called gay propaganda law and most importantly he voted against the annexation of the crimea. that took a lot of courage. ilia worked in this country in high tech. he has a background in investment and, as i said already, in oil and gas. he was a member of the duma for the just russia party and he is

really a political star. in any other democracy he would have been a vice minister and a minister and a respected member of legislation. instead, as he is going to tell us, his going is rough and is becoming rougher. so ilia, welcome and let's have meaningful conversation about what's going on. >> the first question i would like to ask you, what made you vote, the only vote against annexation of the crimea? i remembered the votes in the german parliament at the beginning of world war i. they paid with their life for

the vote against a senseless world war. what makes you stand up and say no when everybody else is voting yes? >> thank you very much for your kind introduction. i'm blushing. i think that you were too kind in speaking like that. the inspiration was coming from that particular example, although the person who convinced me to do what i have done was vladimir putin. it was two days before the actual vote was taking place. it was a presidential address to the assembly, to the lower chamber and there was a big crowd of people, maybe 1,000 people all together because there were members of parliament

plus governors and some other invited guests. everybody was just shouting and waving hands and praising putin. they were hailing the chief and saying, let's take over crimea. that was so -- it reminded me so much of the soviet past and the negative past of the soviet past, take me correctly. so firstly, i decided to sit and not to stand up and not to join that cheering crowd. secondly, i decided that i have to vote against. i was hesitant whether i should just not take part in the vote or should i vote against. that time i was convinced that i should vote against. this is the emotional part.

the rationale part is that being of course patriot of russia, i was thinking that this move to take over crimea is extremely unbeneficial for my country. what we ended up with, firstly, our brother nation of ukraine is no longer a friend. whatever dreams we had about the union, about the joint projects went down in ashes. we were always thinking about the issues of national security and were saying that n.a.t.o. should never come to ukraine and ukraine should remain neutral. and that was pretty much supported by ukrainian people. in 2013, the national polls in

ukraine indicated that from 15 to 17% were in favor of joining n.a.t.o., others were against. now after our move, the majority of ukrainians want to be part of n.a.t.o. that's also not beneficial for russia. thirdly, it's the question of international investments and technological climates in my country. we now became alienated from the rest of the world. even without like an open confrontation, i am skeptical about the sanctions imposed on russia but it's clear that the investment climate is significantly worse than it was just half a year before. the capital from russia this

year is estimated between 150 and $200 billion. that means that every single citizen of russian payid more than $1,000 for annexation of crimea. that's twice as much as we are investing in healthcare. this is seven and a half times more than we invest in r and z. >> on a per capita basis? >> it's in absolute figures. the budget per annum for healthcare in russia is $71 billion u.s. and the capital, 350 plus. >> so let me ask you this, the idealogical and spiritual climate in russia that a lot of folks in the u.s. have a hard time following because of the

language, because we're preoccupied with our domestic issues, obamacare, we're preoccupied with china -- >> good for you. >> but to focus on what is happening in russia socially and idealogical, you really either have to live there or have to spend a lot of time doing that, like myself being addicted to the russian facebook. what i see is a quick change, a fast change from sort of lay za fair model that we had in the past decade and from the 2000 to 2004, then again maybe under medvedev. it was authoritarian bass not particularly harsh. actually the change started to happen even before ukraine with

the ban on adoption of russian kids, with the ban on support of russian nonprofits by western funders, the gay, anti-gay propaganda law. all kinds of things that the state is increasing its interference in people's lives. how does ukraine affect that and where is it all moving? where is it going? >> ariel, i think that those changes, you know, they're pretty much on the surface. the fundamentals are the same. the fundamentals are such that russia as united states is a nation which believes in its mission. our mission is similar. we believe in freedom. we believe in our core values.

it was communist time when russia understood that those communist ideas are the lack of freedom, invigoration for our neighboring nations and the rest of the world. we defeated fascism. >> in correlation with the united states. >> we believe we did it alone. no, because really the official number is 28 million perished during world war ii and that is something that every single family in russia has suffered, every single family has. >> getting to ukraine today, what role is it playing? >> i'm getting there. so there was a mission which

suddenly disappeared in the '90s and 2000s. but it didn't go anywhere but at our core, it was still there. the biggest national idea for russia during all those years wag the victory day. >> may 9th, not may 8th? >> yeah, because of the time difference. >> the european victory of world war ii, which stalin made sure it won't be the same day the europeans are celebrating. >> yes. anyway, that's our main national holiday and that's what unites the whole nation. how it was presented to the nation by president putin is that in ukraine those are western sponsored fashists who came to power.

he illustrated that with a flex of former ukrainian liberation army who were with us during world war ii, and allies with - world war ii and proved these are fascists fighting against both russian and ukrainian nation. it's misinterpretation we're looking to protect russians no, for the overwhelming majority of russians, we are continuing world war ii. we're liberating, really liberating ukraine from the fascist threat and more we are thinking about really breaching europe because what is europe these days, it's these gay people, arabs who are destroying civilization and christianity and putin is always referring to

those values of christianity and our beliefs and tradition. he's extremely conservative from this sense. his allies in europe, french, britain -- >> the head of the national front. >> and other ultraright conservatives in many countries. after recent elections to european parliament, they were in old russia media, were presented as a huge success of those rights. >> isn't there a paradox, you have family members who were specialists on different political movements in the outside world. so the soviet union until about 87 or 89 was a great supporter of communist and leftist movements all over the world.

i wrote my master's thesis about that. not only 25 plus years later russia is viewed or putin is viewed as not just an ally but as a guiding light to the neofascist hungarian party or to german national democrat party, which is neo-nazi, and somehow the ukrainian ultranationalists are put aside and the percentage of the vote of the recent presidential election in ukraine in favor of ultranationalists is only 10% whereas in france and hungaries 20% higher for these guys. what is the swing of pen dull up from left to right? >> i think the extremists are getting pretty close to each

other. if you look at the u.s. example and our brilliant channel, russia today, it's been admired by both tea party followers and occupy wall street followers, right? >> maybe occupy wall street and russia today but -- >> you know, maybe you are not that familiar with tea party. >> i'm not that familiar, right. i will show you example. >> with the exception that i can't think of anybody who admires vladimir putin. i think it's actually pretty natural because putin during the last 20 years in general, our officials are trying to capitalize on the ancestry of the soviet union but keep it from the ideas of revolution.

and still extremely popular and still been seen by as the most successful leader of russia in all ages. >> how many people stalin killed -- >> there are -- i'm saying about national polls, people who still support stalin, between 20 and 30% in all polls -- >> and think positive of stalin. >> despite the fact that the research indicated probably up to 20 million people were killed. >> i think 20 million is not accurate but it doesn't matter. even if it was 100,000 -- >> if you're taking the civil war, the agriculture in the early 30s and the repression -- >> millions and millions of people. >> let's not go in this discussion, but my point is that

stalin during soviet union times was always seen and driven on the leftist agenda. right now, it's been seen as a great emperor in the great con qu kerrer and holder of the empire. and putin is trying to build his from stalin and capitalize on that. >> do you remember when putin said we were weak and the weak are beaten? that was a direct quote. >> yeah. >> i want to move on to something close to your heart. innovation and foreign investment. you were at lead on the project was brought to partial end and i don't see anything that is

replacing it as sort of a magnet for pushing forward russia high tech, getting young entrepreneurs to develop their id ideas for what i read as people do business in their 20s or early 30 he is. what is going on with that? what are the i am pediments today to investment in entremendous newership of russia? >> in that community, one trend which is more visible and more vocal and probably larger in quantity is what they are saying is the trend to immigrate and several examples like russia mark zuckerberg, dual founder russian version of facebook and

you might know, that's what i like to boast with. facebook is number four russian network, not even number two or number three. >> on the fourth is facebook. so our engineers are really greatest of them and he said that he no longer wants to stay in russia because of the attacks on security people and particularly from those trying to take over as the company. our biggest i.t. company is now under big attack. our first and biggest system integration company, company ideas announced he's moving outside russia.

so there's a significant fleet. the flight, flight of this -- of those groups. from the other side, several of our developers are focused on the domestic market. they think that there can be bigger military procurement and higher demand for techologists and so that they will be getting more money. my personal opinion is that increase in domestic spending for new technologies will be not so significant as people expect and russia during the recent 20 years of liberal reforms and new liberal reforms lost its ability to produce a lot of high

technology products and relies on importing them from the outside. and restore serial reduction of those things would be extremely difficult in length. so -- >> but i saw him pushing for military industrial, he was pushing to shut down the gps stations on the russian territory. i don't remember if he threatened tore made the move to curb the russian booster rockets to the space station, at least there was a threat, maybe a decision, i'm not sure. but are there any accomplishments with space launch, what are the accomplishments so far of this very status approach to inno vacation and high tech?

>> you see, i was always very vocal performance of creating our own tech nolgss which would at least go pair to pair with international peers and regularly replace them, same thing as -- >> as an import substitution or global competition. >> as a global competition and of course domestically to use our internal markets to boost the demand and to make money for our high tech companies and a great example of such technology. >> do you believe that without competition in russia from foreign competitors -- >> exactly my point. if you're shutting down competition, you have no drive to increase your service and to increase quality. and quality is not yet there. it's being gradually improving but it's not yet